The collective idea of smart cites appeared as a modern urban development vision to optimise the management of city infrastructures and services by combining Information and Communication Technology (ICT) and Internet of Things (IoT). Alongside the technological advancements, the expansion of urban areas has set new scenarios, problems and challenges within the municipal and metropolitan contexts which inevitably require innovative ways to help local governments improve their citizens’ lives. Waste management stands as one major issues to face and within this waste collection systems (WCS) commonly represents the most impactful phase. This paper presents an hybrid methodology combining Design Thinking and Lean Startup to provide a holistic and deep understanding of the various WCS processes to subsequently develop a viable and innovative solution to better respond the municipality’s economic and operational needs. The researchers conducted an empirical application throughout a case study within the WCS context of a European municipality that recently embraced a smart city initiative following the proposed methodological stages, framed in the problem-solution space, by collecting wide range of data, together with the solution exploration and fine-tuning. It has been concluded that the hybrid approach provides both rich understanding of the problem space while minimizing implementation risks.